HR Glossary

Performance Improvement Plan (PIP)

A Performance Improvement Plan or Performance Action Plan (PIP) is a tool to help the underperforming employees improve their performance so that they can succeed. It is used to address the setbacks, failure to meet the job goals or to work on the behaviour related issues.

The outcome of the PIP may vary as it depends on the overall performance improvement, skill recognition or the gap in training. The actions after that are transfer, termination or demotion.

In this situation, the HR must-

  • Find out whether the PIP was required or not.
  • Administer all PIPs with the manager to avoid bias.
  • Guide the employee and the manager throughout the execution of PIP.